Ascot Arranges C$25 Million Bought Deal Financing and US$50 Million Additional Funding for Completion and Ramp-Up of the Premier Gold Project

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VANCOUVER, British Columbia, Jan. 22, 2024 (GLOBE NEWSWIRE) -- Ascot Resources Ltd. (TSX: AOT; OTCQX: AOTVF) (“Ascot” or the “Company”) is pleased to announce the Company has entered into non-binding term sheets for a total of approximately US$50 million in additional funding from Sprott Resource Streaming and Royalty Corp. and/or its affiliates (“Sprott Streaming” or “SRSR”) and Nebari Natural Resources Credit Fund II, LP (“Nebari Credit Fund II”). Additionally, the Company has entered into an agreement with a syndicate of underwriters co-led by BMO Capital Markets and Desjardins Capital Markets (collectively the “Underwriters”), pursuant to which the Underwriters have agreed to buy on a bought deal private placement basis, 56,820,000 Common Shares of the Company (the “Common Shares”) at a price of C$0.44 per Common Share, for gross proceeds of approximately C$25 million (the “Offering”). The proceeds from these additional funding sources will be used for the construction and operational ramp-up of the Premier Gold Project (“PGP” or the “Project”), to buy-back existing royalties, for additional working capital, and for general corporate purposes.

The proposed financing package would consist of a royalty restructuring (the “Royalty Restructuring”) with Sprott Streaming for gross proceeds of US$30 million, a US$20 million cost overrun facility (the “COF”) with Nebari Credit Fund II, and the C$25 million Offering.

FINANCE PACKAGE HIGHLIGHTS

• Royalty Restructuring: US$30 million gross proceeds for Ascot to grant and sell to SRSR a new 3.10% NSR royalty covering the PGP property package (the “Sprott Royalty”). Until the end of 2026, up to 50% of the new royalty can be repurchased for varying amounts depending on timing and cumulative production. C$13.7 million of the gross proceeds will be used to buy back two existing 5% NSR royalties on various PGP property claims, resulting in net proceeds of approximately US$20 million.
• Cost Overrun Facility: US$20 million from Nebari Credit Fund II to be drawn in full at closing, with maturity to be in June 2027. The interest rate would be 10.0% plus the greater of: (i) 3.5% and (ii) the three month secured overnight financing rate (“SFOR”) per annum. Nebari Credit Fund II will also be granted warrants to purchase Common Shares, as described below.
• Nebari Gold Fund Convertible Facility amendments: In connection with the Cost Overrun Facility, Ascot would amend certain terms of the credit agreement entered in June 2023 with Nebari Gold Fund 1, LP (“Nebari Gold Fund” and together with Nebari Credit Fund II, “Nebari”), which consisted of a US$14 million convertible facility (the “Nebari Gold Fund Convertible Facility”). The conversion price would be amended to C$0.53.
• The Cost Overrun Facility and the amended Nebari Gold Fund Convertible Facility (together the “Nebari Loans”) will have a combination of senior and second lien security for the total amount outstanding under the Nebari Loans with a US$20 million first lien position pari passu with SRSR existing streams and amounts over US$20M having a second lien position behind SRSR’s existing streams.
• Ascot’s strategic investor Ccori Apu S.A.C. intends to participate in the Offering to keep their pro-rata share ownership of approximately 19.9%.
• The three components of the proposed financing package, namely the Royalty Restructuring, the COF, and the Offering, are all cross conditional and are anticipated to close on or about February 9, 2024, subject to successful negotiation and execution of definitive agreements and receipt of regulatory approvals, including Toronto Stock Exchange (“TSX”) approval.

Derek White, President and CEO of Ascot commented, “Over the past year the Company, despite many challenges, has achieved significant progress in the construction and mining development of the Premier Gold Project and we are excited about moving towards production in the very near term. Project construction was 86% complete at the end of December 2023, and as we complete this phase of the Project, the Company has been focusing it efforts to prepare for the initial production and ramp-up phase of the operation. It is paramount at this stage that the Company is well financed and I believe this funding package accomplishes this.